Coinbase has filed a petition to force the US Securities and Exchange Commission to respond to a months-old petition asking whether the securities regulator would allow the industry to be regulated using existing SEC frameworks, the company said. exchange firm on Monday, escalating its tensions with the regulator that has stepped up enforcement actions and warnings against crypto firms, including the US giant.
In the July 2022 petition, Coinbase asked if the SEC would “propose and adopt rules to govern the regulation of securities that are offered and traded through digital native methods.” The SEC never responded to the petition.
“The rulemaking process exists so that agencies can develop regulation for the benefit of public opinion and have their position tested through judicial review. To date, more than 1,700 entities and individuals have submitted comments to Coinbase’s petition echoing the request for clarity,” Coinbase’s chief legal officer Paul Grewal said. wrote in a blog post.
Grewal stated that from the SEC’s public statements and enforcement activity in the crypto industry, it appears that the regulator has already decided to reject Coinbase’s petition, “but they haven’t told the public yet.”
The petition, filed Monday in the US Court of Appeals for the Third Circuit, is the latest rejection the SEC has received in recent months, as the regulator pushes actions against crypto companies Bittrex, Gemini, Genesis, as well as as businessmen like Justin Sun and Haz Kwon.
Last month, the SEC threatened to sue Coinbase about some of the exchange products. Coinbase is the gold standard among crypto exchanges for compliance, but the American company has suffered over the years because it was unable to develop and launch new products due to legal uncertainties, even as its rivals scaled up. international markets.
Brian Armstrong, Coinbase’s co-founder and CEO, said the exchange could consider moving its headquarters outside of the US unless the country changes its approach to regulation. “Anything is on the table, including relocation or whatever it takes,” he said last week.
“Coinbase does not take any litigation lightly, especially when it is involved with one of our regulators. Regulatory clarity is overdue for our industry. However, Coinbase and other cryptocurrency companies face potential SEC compliance action, despite the fact that we have not been told how the SEC believes the law applies to our business,” Grewal wrote.
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